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COSTCO

Discussion in 'Australian-Russian Meeting Place' started by aussie pride, Dec 10, 2011.

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    aussie pride Senior RMP Member
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    A question to our american friends.
    Why do people shop at costco, whats the attraction.

    Costco has now opened 3 stores that i know of here, with plans for more.
    Melbourne has been open for a while but syd'/ canberra opened around july.

    They claimed they would stir up competition here with our resident rip off super market giants which sent them into a tiz claiming all sorts of destabliseing etc for shoppers.

    N being very astute with a dollar said we will join there shopping club .
    After loseing an argument with her i paid the $ 60 fee online months before they opened but managed to avoid going there untill a couple of weeks after the store opened.
    Eventually i was coerced to go (like i had a choice)& discovered these morons had set up there store on 1 of the main rds into the CBD,the cops closed them just as we got to the end of the que to go in ( after takeing ages to get anywhere near them to park ) for safety reasons & major traffic disruption which pissed me off.

    Yesterday N got me to go, saying we will do all our xmas shopping there.
    1st they open an hour later than any other super market,not happy.

    Then we had to que to get our membership cards, so slow that even blasie N got annoyed & then discover that there prices were way over the top.

    There prices didn't come close to competeing with the other rip off artests, haveing just bought all of our seafood & meat elsewhere we were stunned at the prices they wanted for the same items,
    Example ,king crab which i'v wanted to try for ages but expensive here was selling at coles (1 of the giants) for$ 40 a kg,fishshop outside selling for $42, costco $49.99.
    Had N not found some cheese that she was missing we would of just walked out & written off the membership fee.
    We bought a few things mainly because we were already there & went to the check out were my wallet was raped bigtime.

    On the way out we saw a sign saying they would refund membership fees if you were disatisfied, guess who arn't members anymore.

    So i have to ask, how do they survive, are they the same in the states,or are they just another rip off giant. :angrbang:
    Please explain what the membership fee is for & why anyone would be silly enough to renew it every year.?
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    GentleGiant Elite Contributing Member
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    We have just had the same thing happen with "Best Buy" in the UK, they came into the market mouthing off about how they would beat the local competition, but everything turned out to be a lot more expensive than they anticipated, and the local market a lot more competitive. After less than a year they have closed their stores and scurried off back to the States.
    At least "CostCo"" are earning a little interest off of your $60 membership fees for a while.
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    Chrismc Elite Contributing Member
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    We have CostCo in the UK also, not been there for years and highly unlikely I would rejoin and go back, (paying a membership fee for the right to buy in their store just seems pretty silly to me) however, I do know someone who worked there and the reason he (having worked there) used them is their return policy, apparently he used to buy stuff, use it for a while then take it back, no questions asked they refunded or exchanged the items for other stuff or newer models.

    Not sure if they still do/allow this, but I remember once he bought a BBQ set off them, had his weekend BBQ, cleaned it up a bit and then took it back for a refund, amazingly they gave him one in full :D I couldn't believe it, but its true.
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    GuestXX Senior RMP Member
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    Actually in Canada, they are competitive, but I still rarely shop there.
    Big ticket items, TVs etc. are good because there return polices is very good, better than most.
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    Buckeye5704 RMP Admin
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    See also Sam's Club (Sam Walton of WalMart fame) and BJ's.

    We have Sam's in Maine where I lived and also in CT as well as BJs.

    They were both competitive depending on what you buy and yes, their return policy is no questions asked.

    My parents (in Sam's) and I when in Connecticut (in BJ's) bought the bulk of our meats and some produce there as well as the odd bit of electronics. We figure, just the savings on meat alone more than paid for the membership fee each year.
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    AkMike Elite Contributing Member
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    We've got Sam's and CostCo here too. The prices on most items are cheaper than the other stores with similar items. BUT I hate buying in buk quanities items that will take 3 1/2 years to use up. Meanwhile we warehouse them..
    Soy Sauce for instance... How long will a gallon last a family of 2? I am guessing 4 years? :axeman:

    But the meats and seafoods are much better prices with very good quality.
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    GentleGiant Elite Contributing Member
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    Not long if they are Chinese !!!!

    (I will be hiding this thread before the wife wakes up and reads it!!!)
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    AkMike Elite Contributing Member
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    LMAO! Point taken GG! :kermit:

    Let me rephrase that then.. An anglo family of 2.... ;)
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    wvadan Contributing RMP Member
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    Aussie, We only have the Sam's here, but from what I understand, it's the same.
    The thing I notice, is it's ALWAYS name-brands. No generics. Also, you usually have to buy in bulk. Or simply a large container.
    I always use the same laundry detergent, so I buy it there. Nearly half the price per ounce. I buy large boxes of asst. Lays chips.
    The lunch size bags make easy portion control.
    If you are happy with store brands, like Aldi has, then it's just as cheap to go there.
    That said, my employer pays my membership fee. :)
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    GentleGiant Elite Contributing Member
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    In the UK I use Lidl (owned by Aldi's brother).

    Once you get past the fact that continental processed food uses less salt and sugar, it is mostly pretty good stuff; and obviously healthier for you.
    Even the kids cereals tend to have less salt and sugar, and more fibre than the Kellogs equivalent.

    Until recently, the "Parkside" range of powertools were a complete steal, far better quality than B&D or Bosch, 1/2 the price and a 3 year warranty; but recently they prices have started going up. They are still better value due to the warranty and quality, but no longer the no-brainer they were.

    Example, I bought a 18.8v (?) cordless drill/driver with spare battery 2 years ago for £19.99, less than the cost of a spare BATTERY for B&D or Bosch, but the price crept up to £24.99, £29.99 and now £34.99.
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    aussie pride Senior RMP Member
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    N happily shops at aldi & usually wont go near the rip off merchants unless she wants something specific that aldi doesn't carry.

    Early on when aldi was new ,it was mostly people trying to cut costs that shopped at aldi, now days you see even very up market cars in the car park.
    N was a typical working mum back in siberia so became very good at stretching rubles, here she maintains that attitude & i'v never been more better off because of it.
    She will come out of Woolworth or Coles asking why does anyone do there main shopping here,its stupid to waste money in such places, i just smile ( frigg'n x never had her smarts) & happily agree.

    A discussion at work today re costco & there fees ,came up with an interesting reason for the fees, conservative estimate of member numbers, say 10,000 multiplied by $60 annularly, $600,000 ,a very tidy earner even without the exorbitant prices they charge.
    We eat quality meat & a lot of seafood so we have a good idea of price, costco are way over the top on price.

    Example ,snapper fillets ,we expect to pay around a 1/3 or more than for whole cleaned fish.
    Costco wanted more for whole snapper in there no inspect possible packaging than we paid for fillets at the fish mongers & the fish shop guarantees there's is fresh that day from the fish markets .

    N compared prices when we did our xmas shopping elsewhare & concluded costco was even with bulk items dearer than woolworths who most aussies would regard as a place to get rip off for groceries .
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    azamuner Lazy Pirate
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    I don't buy into everything being cheaper at those big box stores. You can get some good prices at Costco but you have to know your prices. People assume everything must be cheaper and get reamed on other items that cost more.

    Being a smart, educated shopper is the only real way to save money.
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    AkMike Elite Contributing Member
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    GentleGiant Elite Contributing Member
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    I have seen a Roller and a Maserati parked at my local Lidl, I see the Maserati most weeks,as well as plenty of Beemers, Aduis and Lexus's (Lexi??)
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    aussie pride Senior RMP Member
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    EasyTarget Senior Member
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    Living in Hawaii you have to shop at Costco...really you do. Unless you are multi-millionaire the cost of using the other chain stores and local stores will eat up your paycheck in a heartbeat.

    The reason being is that the cost of shipping items to Hawaii can add anywhere between 25% - 150% to the cost of the item. I am not joking. Price for a gallon of milk at local Safeway (chain of supermarkets from the west coast of the USA), is at about normal price $8.25+ per gallon, local Costco is at $3.89 per gallon. A huge difference in cost for the same item, coming from the same processing plant in California.

    The Costco gas station usually saves you between $0.07 - $0.15 per gallon of gas. The savings on the gas can easily cover the cost of the membership card. $0.10 per gallon * 10 gallons per week * 52 weeks a year, is saving $52.00 per year.

    The critique of having to buying in bulk when you buy items from Costco is usually slanted at the food items. And yes for many of the food items it isn't practical to buy large amounts of food items when you are single or just a couple. 20lbs of oranges for a single person is a bit much, but for a family of 5 or 6 it does make sense. However when you look at the dry goods you can normally save 40% - 50%. And yes you will have a bigger bottle of laundry detergent, or extra rolls of paper towels... but it does save.

    The question is who buys the 25lb bag of sugar or the 5 gallon jug of soy sauce. Restaurants. Costco has a good percentage of their business in business to business sales, i.e. local restaurants and the like. A restaurant can go through 100lbs of sugar or flour in a week of normal operations. Costco started out as a wholesaler for businesses and then shifted their attention to individual households.

    Normally retail chains have a difficult time when starting up in a foreign country. The prime example is Wal-Mart. Wildly successful in the USA but they have yet to repeat the success in multiple countries. Wal-Mart does well in Canada in Mexico. I am not surprised that Best-Buy failed in the UK, they are failing in the USA so it makes sense. All of the items are coming from China, difficult to get a competitive advantage when you are competitors are sourcing your inventory from the same location.

    It is the same thing when Virgin and HMV started stores in the USA, they made a big splash and now, most if not all of their stores are out of business. It seems that only food chains are able to succeed overseas, i.e. McDonalds, KFC, etc... Although they alter their menus to comply with the local populations expectations.

    Although Aus still has a Woolworths ? That I don't get.
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    Brian2 Contributing RMP Member
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    Unrelated to the woolworths you may have known - it's a huge company here. According to Wiki they stole the name from elsewhere :):)

    Turns over about $50 Billion a year.
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    AkMike Elite Contributing Member
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    Here there used to be F W Woolworths. It was a pharmacy and soda fountain. The store here in Anchorage closed about 15 yrs ago. I don't know if they are still aorund elsewhere.
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    richmke RMP Member
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    Interesting that she is happy with Aldi's (generic store), whereas, when you bring a gift to Russia, it should be a name brand.

    Anyway, in the USA mainland, the appeal of the warehouse stores is that they have certain better quality items that are not stocked in the regular retail stores. The bulk quantity is also a "good" price, although "sale" price at other stores tends to be better. But, there is a cost of your time to be shopping sales to save a buck or two.

    Maybe in AU they have not reached the critical mass where their quantity buying can really make a difference in price.

    BTW: It takes me about a year to go through a gallon of soy sauce. I've just discovered shopping on Amazon.com for bulk items like dishwasher detergent. We use a certain brand (don't ask), and it is much cheaper to buy a case online with free shipping. Fortunately, I have the room to store all the stuff. I think of it as my disaster supplies.
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    EasyTarget Senior Member
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    My other thought is that one of the major advantages to Costco is that they have their own store brand, "Kirkland". Where they have contract manufacturing, i.e. generic, in place for the items.
    I am thinking they haven't been able to set up this relationship in Aus yet? and it would be cost prohibitive to ship from USA to Aus.

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